The investigation found that Three did not handle some customer complaints in a fair and timely manner. This was because some complaints were closed without the company establishing that they were fully resolved.

In some other cases, Three did not log calls from customers as complaints when it should have done. This meant that concerns raised by these particular customers were not entered into, or treated in line with, Three's formal complaints process.

As a result of these breaches, Three did not make these customers sufficiently aware of their right to escalate a complaint to alternative dispute resolution (ADR).

ADR is an important piece of consumer protection. It allows customers to refer complaints that cannot be resolved with their provider to an independent body to reach an impartial judgement.

Access to ADR is free of charge to customers. Paper bills sent to Three customers, however, failed to mention this - a requirement on all communications providers.

During the course of the investigation, Three fully cooperated with Ofcom and has taken steps to ensure it is now compliant with its complaints handling obligations. Three also took steps to remedy its breaches where it could.

Ofcom also noted that, although the investigation identified certain shortcomings in Three's complaints handling processes, the harm to consumers was mitigated due to the efforts of frontline customer service staff.

In addition, all providers must be members of, and help consumers to access, an Ofcom-approved ADR scheme.

Financial Penalty

Ofcom believes that Three has taken sufficient steps to ensure it is now compliant with its complaints handling obligations.

Ofcom has decided, however, to impose a financial penalty of £250,000 against Three.

The penalty is payable to Ofcom and passed on to HM Treasury and Three is required to pay it within 30 days of receiving the penalty notification.

Claudio Pollack, Ofcom's Consumer and Content Group Director, said: "When things go wrong, customers are not only entitled to complain to their provider, but must have confidence that their complaint will be dealt with fairly.

That's why we impose strict rules on providers on how they must handle complaints.

"We treat any failure to follow these rules very seriously. The fine imposed on Three takes account of the shortcomings in its complaints handling, but reflects that the harm to consumers in this case was limited. The company fully co-operated with our investigation and has now taken steps to ensure it's compliant with the rules on complaints handling."

ENDS

NOTES FOR EDITORS

1. Ofcom's complaints handling Code of Practice includes requirements for all providers to :

a. handle complaints in a fair and timely manner;
b. provide concise, easily understandable and accessible information for consumers about their complaints processes. This must tell customers how to make a complaint; how the provider will investigate it ; and the likely length of time it will take to try to resolve the complaint. The information must also include the contact details for the relevant ADR scheme the provider belongs to; and
c. ensure consumers are told of their right to use ADR by including text in paper bills. Providers must also write promptly to customers, informing them of their right to go to ADR, if their complaint remains unresolved after eight weeks.